Tea Party group chief quits, cites internal split

Caption

(Cliff Owen FRE)

FILE - This Feb. 18, 2010 file photo shows former House Majority Leader Dick Armey speaking in Washington. Eased out with an $8 million payout provided by an influential GOP fundraiser, Armey says he has left a conservative Tea Party group, FreedomWorks, because of an internal split over the group's future direction. (AP Photo/Cliff Owen, File)

WASHINGTON – Eased out with an $8 million payout provided by an influential GOP fundraiser, former Republican House Majority Leader Dick Armey says he has left a conservative Tea Party group, FreedomWorks, because of an internal split over the group's future direction.

A confidential contract obtained by The Associated Press shows that Armey agreed in September to resign from his role as chairman of Washington-based FreedomWorks in exchange for $8 million in consulting fees paid in annual $400,000 installments. Dated Sept. 24, the contract specifies that Armey would resign his position at both FreedomWorks and its sister organization, the FreedomWorks Foundation, by the end of November.

According to the contract, Armey's consulting fees will be paid by Richard J. Stephenson, a prominent fundraiser and founder and chairman of the Cancer Treatment Centers of America, a national cancer treatment network. Stephenson is on the board of directors of FreedomWorks.

Armey's departure comes as a new sign of acrimony in conservative and Republican ranks as the party's bruised leadership struggles with its November electoral losses and uncertainty over how to recast its principles and issues to compete with an ascendant Democratic party.

Armey confirmed his departure Tuesday, telling the AP that "my differences with FreedomWorks are a matter of principle." Armey said he made the decision to quit FreedomWorks in August, but Stephenson and other board members urged him not to leave until after the Nov. 6 election. Stephenson did not immediately respond to calls from AP for comment.

Armey would not describe his specific concerns, but the former House majority leader told the Mother Jones website that the Tea Party group was moving in an unproductive direction. He also indicated dissatisfaction with the November election results, in which several GOP candidates supported by FreedomWorks Super PAC donations were beaten by Democratic party rivals.

In an internal Nov. 30 resignation memo published by Mother Jones, Armey told FreedomWorks CEO Matt Kibbe to remove his "name, image and signature" from all of the group's materials and web operations. Kibbe and other FreedomWorks officials were not immediately available for comment.

Armey, who had been with the Tea Party group since its 2004 founding, is a veteran Texas GOP political figure who was intimately involved in the GOP's conservative "Contract with America" congressional movement in the 1990s. While Armey, 72, was the group's eminence and at first, its public face, the younger Kibbe has been its most active official, appearing at FreedomWorks' public gatherings.

FreedomWorks flourished after a wave of Tea Party House candidates swept into office in 2010, but despite spending hundreds of thousands of dollars to back favored GOP candidates in November, the group's influence appeared to wane at the polls. Among the GOP losers supported by FreedomWorks in November were Senate candidates Josh Mandel in Ohio, Connie Mack in Florida and Richard Mourdock in Indiana.

Overall, Tea Party-influenced House legislators fared better in the recent elections, though their ranks thinned. At least 83 of 87 Republican House members who were allied with Tea Party anti-government spending causes ran for re-election in November, and all but eleven were returned to office. A twelfth — Rep. Jeff Landry, R-La., faces an uphill runoff election this month against another GOP incumbent.

FreedomWorks' internal secrecy and its role as a high-financed super political action committee became an issue in the weeks before the election when federal campaign finance documents revealed that a shadowy Tennessee-based corporation had funneled seven donations totaling $5.28 million to the Tea Party group. The amount was the largest political contribution to a super PAC in 2012 from a business group that would not identify its donor.

FreedomWorks would not identify the anonymous donor, and a Tennessee lawyer who helped set up the group would also not divulge the head of the firm, Specialty Group Inc. The Tennessee firm later changed its name to Specialty Investments Group Inc. on Nov. 28.